Morgan Stanley, the sixth-largest U.S. bank with $858 billion in total assets has hired former Credit Suisse trader and crypto enthusiast Andrew Peel to head its digital asset department, as reported by eFinancialCareers.
The move is likely to tighten the race for the best crypto-trading desk with rival Goldman Sachs, which recently appointed David Solomon, who is keen on bitcoin, as chief operating officer.
According to Solomon, Goldman Sachs is already offering clients publicly-traded derivatives tied to bitcoin but in an interview with Bloomberg he said the bank is exploring cryptocurrency trades beyond the publicly-traded derivatives.
Every bank on The Street may have a different opinion about bitcoin, but even the more skeptical ones are willing to explore blockchain technology.
Former head of J.P. Morgan's blockchain arm Amber Baldet believes that we might still see major banks getting into the cryptocurrency business in the near future.
“I think it's coming sooner than people probably think," Baldet said in an interview with CNBC.
While many prominent banks have cracked down on cryptocurrencies and moved to ban their use, there are a number of banks that look to set step in and provide cryptocurrency friendly services.
U.S. Federal Reserve Bank
In June 2018 four cryptocurrencies were added to the Federal Reserve Bank of St. Louis, one of twelve regional banks in the US central banking system.
The bank is tracking the prices of four different cryptocurrencies: bitcoin, bitcoin cash, ethereum, and litecoin. The price data are updated daily and span from as early as 2014 to the present day.
All data is obtained from the cryptocurrency exchange Coinbase.
Barclays, the London-based multinational investment bank with over 325 years of history and expertise in banking, has recently filed two cryptocurrency-related patents with the United States Patent and Trademark Office.
The first patent describes the method and system for transferring digital currency from the payer to the recipient. The patent lists a wide range of use cases for securely and privately processing data using a blockchain system.
Barclays expects the beneficiaries of the system to include account holders, merchants, user authorities, and banks.
The second patent is related to the method and system for recording data using blockchain.
In spring this year Barclays was rumored to be thinking of opening its own crypto trading desk. CEO Jes Staley rushed to refute the news, admitting, however, that the banking giant is looking into cryptocurrency-related business opportunities, but is wary of regulatory issues.
Earlier this year Coinbase announced a partnership with Barclays that would allow the cryptocurrency exchange to open an account with the bank, thus making it easier for the exchange’s UK customers to buy and sell cryptocurrencies.
Bank of England
The Bank of England is carrying out research into digital currencies and the technology that supports them. According to the bank’s Financial Policy Committee report, cryptocurrencies pose risks to investors but do not currently pose a risk to monetary or financial stability in the UK.
The Bank of England has long been speaking about its interest in central bank-issued digital currencies. While they are not planning to create one imminently, they are exploring the implications of issuing a digital currency.
Speaking on a panel in Stockholm on the future of central banking, the Bank of England governor Mark Carney said he was open-minded about the prospect of a central-bank-issued digital currency, Bloomberg reported.
He added, however, that the issue was not pressing, and that cryptocurrencies currently don’t perform the role of money.
USAA bank, which has been serving the U.S. military members and their families since 1992, has become the first major U.S. bank to invest in a cryptocurrency exchange. The bank’s mobile banking app allows customers to access their Coinbase account, view the balance and monitor transactions.
In January 2018 Germany-based Fidor Bank teamed up with cryptocurrency exchange Kraken to launch an initiative to establish a “specialized bank for cryptocurrencies” and to provide a wide range of financial products and other services related to cryptocurrencies.
According to Fidor Bank’s official website, its Cryptocurrency-as-a-Service offers simplified new crypto-related investing and trading areas, “transforming into new crypto brokerage solutions, tailored to your needs.”
The bank offers two different accounts - an ICO Account that supports your ICO and an Exchange Account that interacts with cryptocurrencies.
“Fidor speaks crypto and understands your business,” the bank says. The bank claims that “as the world’s oldest fintech bank,” it is different from other banks because it comprehends cryptocurrencies “and has a strong experience in crypto-related topics.
Metropolitan Commercial Bank
The Metropolitan Commercial Bank is handling millions for crypto clients and is interested in expanding further.
“We’re certainly very interested in growing this vertical. We’ve learned that it’s a serious industry. There are some very smart people involved. There are some very interesting ideas coming out that could really change the way people do business,” the bank’s chief technology Officer Nick Rosenberg said in a recent interview with CoinDesk.
The Metropolitan bank’s clients include a few exchanges, as well as hedge funds and other crypto investors.
The Liechtenstein-based Bank Frick offers trading in five leading cryptocurrencies including bitcoin, bitcoin cash, litecoin, ripple, and ethereum. At Bank Frick, cryptocurrencies are held in “cold storage wallets.”
Clients can only invest in cryptocurrencies once they have been fully identified and verified. The verification and identification process also involves checking the origin of the money used to invest in them.
At Bank Frick, cryptocurrency investments are subject to the same strict statutory measures as traditional financial transactions.
Simple Bank is a U.S.-based bank which works with a number of different cryptocurrency exchanges. Available online or a via their smartphone app, it allows anyone to trade fiat currency for cryptocurrencies. Unlike other traditional consumer banks, Simple has no physical branches. Customers can still get VISA debit cards issued by one of Simple’s partner banks.
Argentina-based Banco Masventas announced in a Facebook post that it would allow customers to make cross-border payments using bitcoin. The move is a result of a partnership with Bitex, a crypto exchange startup targeting Latin American users. The bank hopes to compete with the SWIFT network.
The bank said on its website that the service would enable international transfers to as many as 50 countries and that payments could be processed within 24 hours or less. The bank thus is looking to grow its list of international customers.